Gaz de France has said it is not going to change the terms of its planned merger with French utility company Suez, ignoring protests from Suez investors that they are not being offered enough for their shares. Chairman and chief executive Jean-Francois Cirelli said he sees no reason to change the one-for-one share exchange parity. He spoke as the state-controlled gas giant reported first-half net profit of 1.7 billion euros, up 44% from a year earlier. The company has 53,000 employees, many of whom were on strike and on the streets of French cities on Tuesday in protest against the merger. They have widespread public support. Only 12% of the French people believe GDF should be fully privatised, with 43% favourable on condition the government retains a majority stake, according to the latest opinion poll.
Bernard Thibault, head of the CGT trade union said: “We have a government which is behaving like its playing a game of Monopoly, where the idea is to jockey for the best financial position and make the greatest possible profits. As a result, we’re going to be completely dependent on private businesses which will use the limited energy resources to justify higher prices and inevitably the customers will be the big losers from this.”
The government has proposed cutting the state’s holding in GDF from some 80% to 34% but is struggling for the political support in parliament to pass a bill to allow that to happen. Gaz de France said the merger is necessary so it can be strong in a consolidating European energy market, to meet future investment needs and to better negotiate gas supply deals.